Many people are concerned about the future of their retirement pension and some are actively pursuing a pension strategy that will help them remain on the welfare rolls for longer. Typically, the first question that comes to the mind is how exactly do you secure your future pension? Often times, it means getting another job which typically entails another set of very difficult and competitive financial calculations. A second job usually costs considerably more than the same salary received from a previous job so this presents a big dilemma for most retirees. In addition, most of us aren’t very comfortable with the idea of giving our children or grandchildren a huge lump sum of cash simply to secure our current financial futures.

Fortunately, you don’t have to give away all your assets just to secure your pension. One great method of doing this is through a life insurance policy. The way that this particular pension plan works is that you create a trust with a selected insurance company and allow them to build an investment portfolio for you. As we know, each and every year throughout your retirement, you will receive your pension.

However, the catch here is that you will be required to contribute a certain amount of money into the investments provided by the insurance company on your behalf each and every year. Typically, this amount is around 20% of your expected lifetime payout. This is where the concept of pension maximization comes in. What this does essentially is that it allows you to save up for your retirement in one single life annuity. As you can imagine, if you are able to accumulate enough funds over the years so that you can eventually leave the nest and purchase a second property, then you will be left with a sizable asset base upon which to rest your feet upon retiring.

The next question that most people have when thinking about pensions and the future is, how will my spouse be paid for my sake if I don’t die while still working? Well, the answer to this particular question is pretty simple actually. The simple fact is that most employers pay their employees either a prorated amount for the entire life or a fixed sum depending on the length of their contract. While you may not have any options with regards to how your money will be used in these contracts, you do have a couple of options when it comes to your spouse’s contributions to your accounts. Typically, your spouse will receive both a lump sum payment and a deferred deposit.

However, it is important to note that both of these payments must be made out of pocket at the time of your death. If your spouse does not die while you are alive, the remaining death benefit will be transferred to your spouse’s life insurance policy and then the balance will be distributed between your surviving family members. In addition, some life insurance policies will allow you to borrow money against the pension. However, this loan will be applied to the entire balance of your pension and will be due at the time of your death. Therefore, you should be wary about the types of loans that you may be allowed because you may not receive a full death benefit if you have to repay the loan prior to receiving your pension.

The only other option that you really have in terms of using your 401k and pension funds is to use a self-directed IRA. Self-directed IRAs will allow you to invest your money completely according to your own desires in any of the many brokerage accounts that are available to you. If you want to increase your investments or take on additional risk, you can do so quite easily with an IRA. However, if you want to completely rely on the tax-deferred growth of your traditional and Roth IRAs, you will need to talk to a financial advisor who can give you a good idea of which plan is best for your specific needs.

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